All data and information on this site is based on data from sources that are not under my control. I cannot guarantee the accuracy of any of the data, in fact I know of some significant data problems such as, but not limited to, incorrect stock splits that lead to radically incorrect prices. No investing decision should be taken based on the information on this site alone, and none of the information here is a recommendation to buy or sell any security!! Do the appropriate further analysis and due diligence before investing.
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Each of the links in the table above goes to a summary page with three sections:
For each page, only stocks with at least the price history given in the leftmost column are considered. All charts on a page are normalized to the specific price history. In other words, for the 25 year price history summary page, only stocks with at least 25 years of price history are screened, and the charts and screen data on the page are the result of analyzing the last 25 years' worth of price history.
Every stock symbol on every summary page is a link to the BMW charts for that stock and price history.
The "All history" group of stocks is special: the page lists stocks passing the BMW Method Screen given their available price history, however long or short.
The Dow Jones pages show all 30 Dow Jones Industrial component stocks with the longest available price histories for each.
The CSV link points to a file containing the basic statistical data (ticker, Average and Current CAGRs, RMS, Return Factor, and latest share price) for each stock in the corresponding summary page and is suitable for downloading into Excel or other application.
Denny Schlesinger at Software Times has put together an excellent interactive site where you can quickly screen for stocks passing a range of BMW-style criteria. The data at Software Times is updated directly from this site (from the CSV files in the table above). Please visit the Software Times BMW Method site for an easy and flexible interface to BMW Method candidate selection.
My BMW Strategy as one reference (evolving). Different people have different strategies for using this data.
The BMW Method is named after Motley Fool user BuildMWell ("BMW"), who noticed how the Dow Jones average seemed to follow, over a long period, an exponential growth curve he calls the Average CAGR (Compounded Annual Growth Rate) curve, but with bounces above and below this "characteristic" growth curve. The Dow average always tended to move back to the Average CAGR curve and furthermore, particularly after a large deviation from the Average CAGR curve, it tends to overshoot the Average CAGR curve on its way back (see this chart of the Dow average from 1896 through 2004 for an illustration). Often this is referred to as "reverting to the mean."
The main idea behind the BMW Method is that a company's stock shows the same behavior, and this graphical method can be used to identify individual stocks that may have reached good buy or sell prices. This is using volatility to the investor's advantage! BMW himself has used and refined his method for over 10 years as his primary income source, and the method has produced net gains in every year. BMW's implementation of his method applies quite a bit more "art" than just fitting curves to price charts, and reading the Motley Fool BMW Method discussion board (subscription required) is really required to appreciate the nuances. Many resources are available from posters on this board to help evaluate companies such as downloadable spreadsheets for more controlled charting methods and in-depth discussions of the businesses. Nonetheless, automatically generated charts of hundreds of stocks each week is useful as a first step to identifying good investment candidates
I am a big fan of the BMW Method, in large part because of its simplicity, and because of the long term perspective it unveils to the investor.
In one BMW Method Chart, you get:
The chart is a great first step that quickly filters stocks down to a small number that you can analyze in more detail.
In contrast with technical analysis, I think the very long-term analysis of price, over at least several long business cycles, shows an Average CAGR which comes reasonably close to truly reflecting the value of the company's stock. The Average CAGR line represents a long-term market determination of the appropriate price of the stock. Over a short term (which can be 10 or 15 years) the market can considerably misprice stocks, as we plainly saw in the 1990s. But if a price trend is looked at over 30 or more years, the over- and under-pricing mistakes the market has made over that time are generally averaged out, and the true value of a share of stock is probably not far from the Average CAGR line, as long as the company is still materially in the same competitive position and following similar strategies. After all, the true value of an investment is what a rational investor, under typical conditions, would pay; 30 or more years of up and down history should reasonably reflect that value.
The charts also very clearly show us that the price variations of any company's stock are large and occur regularly, and that given enough time, the prices tend to revert to the Average CAGR, normally overshooting the correction. At any time there are a few very undervalued stocks, a few very overvalued stocks, and many in between. Simply waiting until the price falls far below its Average CAGR provides the potential buying opportunity.
Each Sunday morning, I automatically download monthly stock close results as far back as 1960 from MSN MoneyCentral for companies with market caps over $1 billion, along with some key index price data, and run my own software to generate all new charts and summary pages. The last price point in each chart should always be that of the last trading day of the previous week (usually Friday's).
Very few companies have 30, or even 25, years of data, far fewer than companies that have had public stock records for that time. For example, approximately 32-35 companies are found in the MSN database with 30-year historical price records and there should be hundreds if not more. I do not know why this is. So, if a stock you know has been around for long enough to be in the screen results and it's not there, and its market cap is over $1 billion, it is because MSN's historical data doesn't list it back that far. As a general guideline, here are the number of stocks with price histories covering the following periods from this week's (10/22/04) download from MSN:
|
Universe
(> $1 billion market cap)
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19
years
|
20
years
|
25
years
|
30
years
|
35
years
|
40
years
|
|
| Number of stocks |
1874
|
276
|
262
|
55
|
34
|
12
|
12
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Known issues with Yahoo stock data (occasional errors in "unadjusted" prices) which affect the long-ago historical prices make Yahoo data unreliable to use for stocks. The effect on some companies (CNP, PCG as known examples) can be very large although most are small.
Many types of assets whose prices are regularly reported can be visualized using the BMW Method charts. Looking at these charts can really help provide perspective that is so difficult to find in today's CNBC-type useless blather environment. Here is a listing of other types of asset data I have tried generating BMW Method charts for. Most of them are really quite interesting.
| Dow Jones Industrial Average, 1896 - 2004 (worth its weight in gold. This should be on every investor's wall) |
| New Home Prices: US Overall, Northeast, South, Midwest, West (is there a bubble in prices? You decide!) |
| A few foreign exchange ratios (skip to the very last section, ignore the rest) |